MAJOR LEAGUE BASEBALL ENTERPRISES, INC.

About MAJOR LEAGUE BASEBALL ENTERPRISES, INC.

It may be the national pastime, but Major League Baseball (MLB) is also a big business. MLB oversees the game of professional baseball in North America that includes 30 franchises in 28 cities across the US and in Canada. The teams operate as a separate business but each is regulated and governed by MLB. The league sets official rules, regulates team ownership, and collects licensing fees for merchandise. It also sells national broadcasting rights and distributes fees to the teams. (Regional broadcast rights are held by each franchise.) MLB was formed when the rival National and American Leagues joined together in 1903.

Sales and Marketing

Like most other major league sports organizations, MLB generates a large portion of its revenue from broadcasting rights paid by television and other broadcasters to air baseball games. The league has a longstanding partnership with News Corporation's FOX Broadcasting, which airs weekend and post-season games under a seven-year agreement that runs through 2013 worth about $1.8 billion. On cable TV, MLB has arrangements with both ESPN (part of Walt Disney) and TBS (owned by Time Warner through Turner Broadcasting): ESPN's eight-year, $2.4 billion deal to air regular-season games runs through 2014, while TBS has rights to some regular-season and playoff games through 2013 under a seven-year partnership worth $850 million.

Strategy

MLB has also built a successful digital media business in addition to its traditional broadcasting partnerships. Its MLB Advanced Media arm operates the league's online properties, including MLB.com (which oversees individual sites for all 30 teams) and ticket sales subsidiary Tickets.com. The division also offers subscription-based audio and video streams online for out-of-market games.

Taking a page from rival sports leagues, MLB created its own cable television network, The MLB Network, which it launched in 2009 in partnership with Comcast, Cox Communications, DIRECTV, and Time Warner Cable. The channel reaches more than 50 million US homes with out-of-market games, as well as baseball news and features.